Press release Vallourec successfully places 250 million Bonds Convertible into New Shares and/or Exchangeable for Existing Shares (OCEANEs) due 2022 Boulogne-Billancourt (France), 27 September 2017 Vallourec (the Company or Vallourec ), world leader in premium tubular solutions, has successfully placed today bonds convertible into new shares and/or exchangeable for existing shares ( OCEANEs ) due 2022 (the "Bonds") for a total amount of 250 million (the Offering ). Following strong investor demand, the initial amount of 170 million has been increased to 250 million. Vallourec intends to use the net proceeds of the issue of the Bonds for general corporate purposes. The nominal unit value of the Bonds has been set at an issue premium of 37.5% above Vallourec s reference share price 1 on the regulated market of Euronext Paris. The Bonds will be issued at par and will bear a coupon of 4.125%, payable semi-annually in arrears on 4 April and 4 October of each year (or on the following business day if this date is not a business day), beginning on 4 April 2018. The settlement-delivery of the Bonds is expected to take place on 4 October 2017. Unless previously converted, exchanged, redeemed or purchased and cancelled, the Bonds will be redeemed at par on 4 October 2022 (or on the following business day if this date is not a business day). The Bonds may be redeemed prior to maturity at the option of the Company, under certain conditions, and at the option of bondholders in case of a Change of Control (as defined in the terms and conditions of the Bonds). Application will be made for the listing of the Bonds on the open market of Euronext Paris (Euronext Access). Such listing will occur within 30 days after the settlement-delivery date. The Offering is managed by Crédit Agricole Corporate and Investment Bank and Natixis, acting as Global Coordinators and Joint Bookrunners (together the Joint Global Coordinators ), BNP Paribas and Société Générale Corporate & Investment Banking as joint bookrunners (together with the Joint Global Coordinators, the Joint Bookrunners ) and Banco Santander as Co-Bookrunner (together with the Joint Bookrunners, the Managers ). 1 The reference share price will be equal to the volume-weighted average price of Vallourec s shares recorded on the regulated market of Euronext Paris from the start of trading today until the determination of the final terms of the Bonds on the same day, i.e 5.0135 1
Conversion/Exchange Right Bondholders will be granted a conversion/exchange right of the OCEANEs into new and/or existing shares which they may exercise at any time from the 41 st day following the issue date (i.e. 14 November 2017) and up to and including the 7 th business day preceding the maturity date or the relevant early redemption date. The conversion ratio is set at one share per Bond subject to standard adjustments in certain cases. Upon exercise of their conversion/exchange right, bondholders will receive at the option of the Company new and/or existing Vallourec shares. The Vallourec new shares eventually delivered shall carry current rights to dividends paid following the date of delivery of the shares. Lock-up In the context of the Offering, the Company will agree to a lock-up undertaking for a period starting from the announcement of the final terms of the Bonds and ending 90 days after the settlement-delivery date, subject to certain customary exceptions or waiver from the Joint Bookrunners. Dilution As a result of the Offering, the issue of 36,284,470 Bonds would lead to a maximum dilution of 8.0% of the outstanding share capital, should the Company decide to exclusively deliver new shares upon conversion. Legal framework of the Offering and placement The Offering of the Bonds has been conducted solely on a private placement basis. The Offering has been made in compliance with Article L. 411-2-II of the French monetary and financial code (Code monétaire et financier), as per the authorisation granted by the Company s extraordinary general meeting held on May 12 2017 (15 th resolution), by way of a private placement in France and outside France (excluding in particular the United States of America, Canada, Australia, South Africa or Japan). Available information The Offering of the Bonds is not subject to a prospectus approved by the French Financial Market Authority (Autorité des marchés financiers) (the «AMF»). Detailed information on Vallourec, including its business, results, prospects and related risk factors are described in the Company s registration document (Document de base) filed with the AMF on 21 March 2017 under number D.17-0191 which is available, together with Vallourec s interim financial report as at 30 June 2017, all the press releases and other regulated information about the Company, on Vallourec s website (www.vallourec.com). Important information This press release does not constitute or form part of any offer or solicitation to purchase or subscribe for or to sell securities to any person in the United States, Australia, Canada, South Africa or Japan or in any jurisdiction to whom or in which such offer is unlawful, and the Offering of the Bonds is not an offer to the public in any jurisdiction, including France. 2
About Vallourec Vallourec is a world leader in premium tubular solutions for the energy markets and for demanding industrial applications such as oil & gas wells in harsh environments, new generation power plants, challenging architectural projects, and high-performance mechanical equipment. Vallourec s pioneering spirit and cutting edge R&D open new technological frontiers. With close to 19,000 dedicated and passionate employees in more than 20 countries, Vallourec works hand-in-hand with its customers to offer more than just tubes: Vallourec delivers innovative, safe, competitive and smart tubular solutions, to make every project possible. Listed on Euronext in Paris (ISIN code: FR0000120354, Ticker VK) and eligible for the Deferred Settlement System (SRD), Vallourec is included in the following indices: SBF 120 and Next 150. In the United States, Vallourec has established a sponsored Level 1 American Depositary Receipt (ADR) program (ISIN code: US92023R2094, Ticker: VLOWY). Parity between ADR and a Vallourec ordinary share has been set at 5:1. www.vallourec.com Follow us on Twitter @Vallourec For further information, please contact: Investor relations Alexandra Fichelson Guilherme Camara Tel: +33 (0)1 49 09 39 76 Investor.relations@vallourec.com Press relations Héloïse Rothenbühler Tel: +33 (0)1 41 03 77 50 / +33 (0)6 45 45 19 67 heloise.rothenbuhler@vallourec.com Individual shareholders Toll Free Number (from France): 0 800 505 110 actionnaires@vallourec.com Disclaimer Important information This press release may not be published, distributed or released directly or indirectly in the United States of America, Australia, Canada, South Africa or Japan. The distribution of this press release may be restricted by law in certain jurisdictions and persons into whose possession any document or other information referred to herein comes, should inform themselves about and observe any such restriction. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction. No communication or information relating to the offering of the Bonds may be transmitted to the public in a country where there is a registration obligation or where an approval is required. No action has been or will be taken in any country in which such registration or approval would be required. The issuance or the subscription of the Bonds may be subject to legal and regulatory restrictions in certain jurisdictions; none of Vallourec and the Managers assume any liability in connection with the breach by any person of such restrictions. 3
This press release is an advertisement and not a prospectus within the meaning of Directive 2003/71/EC of the European Parliament and the Council of 4 November 2003 as amended (the Prospectus Directive ). The Bonds will be offered only by way of a private placement in France to persons referred to in Article L.411-2-II of the French monetary and financial code (Code monétaire et financier) and outside France (excluding the United States of America, Australia, Canada, South Africa and Japan), and there will be no public offering in any country (including France). This press release does not constitute a recommendation concerning the issue of the Bonds. The value of the Bonds and the shares of Vallourec can decrease as well as increase. Potential investors should consult a professional adviser as to the suitability of the Bonds for the person concerned. European Economic Area With respect to the Member States of the European Economic Area which have implemented the Prospectus Directive (the Relevant Member States ), no action has been undertaken or will be undertaken to make an offer to the public of the Bonds requiring a publication of a prospectus in any Relevant Member State. As a result, the Bonds may only be offered in Relevant Member States: (a) to any legal entity which is a qualified investor as defined in the Prospectus Directive; or (b) in any other circumstances falling within Article 3(2) of the Prospectus Directive. For the purposes of this paragraph, the expression offer to the public of Bonds in any Relevant Member State, means any communication, to individuals or legal entities, in any form and by any means, of sufficient information on the terms and conditions of the offering and on the Bonds to be offered, thereby enabling an investor to decide to purchase or subscribe for the Bonds, as the same may be varied in that Relevant Member State. These selling restrictions with respect to Relevant Member States apply in addition to any other selling restrictions which may be applicable in the Relevant Member States. France The Bonds have not been and will not be offered or sold or cause to be offered or sold, directly or indirectly, to the public in France. Any offer or sale of the Bonds and distribution of any offering material relating to the Bonds have been and will be made in France only to (a) persons providing investment services relating to portfolio management for the account of third parties (personnes fournissant le service d investissement de gestion de portefeuille pour compte de tiers), and/or (b) qualified investors (investisseurs qualifiés) acting for their own account, as defined in, and in accordance with, Articles L.411-1, L.411-2 and D. 411-1 of the French monetary and financial Code (Code monétaire et financier). United Kingdom This press release is addressed and directed only (i) to persons located outside the United Kingdom, (ii) to investment professionals as defined in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the Order ), (iii) to people designated by Article 49(2) (a) to (d) of the Order or (iv) to any other person to whom this press release could be addressed pursuant to applicable law (the persons mentioned in paragraphs (i), (ii), (iii) and (iv) all deemed relevant persons ( Relevant Persons )). The Bonds and, if applicable, the shares of Vallourec to be delivered upon exercise of the conversion rights (the Financial Instruments ) are intended only for Relevant Persons and any invitation, offer of contract related to the subscription, tender, or acquisition of the Financial Instruments may be addressed and/or concluded only with Relevant Persons. All persons other than Relevant Persons must abstain from using or relying on this document and all information contained therein. 4
This press release is not a prospectus which has been approved by the Financial Conduct Authority or any other United Kingdom regulatory authority for the purposes of Section 85 of the Financial Services and Markets Act 2000. United States of America This press release may not be published, distributed or transmitted in the United States of America (including its territories and dependencies, any State of the United States of America and the District of Columbia). This press release does not constitute or form a part of any offer or solicitation to purchase for securities in the United States of America or to, or for the account or benefit of, U.S. Persons (as defined in Regulation S under the US Securities Act of 1933, as amended (the Securities Act )). The Securities have not been, and will not be, registered under the Securities Act, the law of any state of the United States of America and may not be offered or sold in the United States of America or to, or for the account or benefit of, U.S. Persons, except pursuant to an exemption from, or a transaction not subject to, the registration requirements of the Securities Act or the law of the above states. The Securities will be offered or sold only to non-u.s. persons in offshore transactions outside of the United States of America, in accordance with Regulation S of the Securities Act. Vallourec does not intend to register any portion of the proposed offering of the Bonds in the United States of America and no public offering of the Securities will be made in the United States of America. Australia, Canada, South Africa and Japan The Bonds may not and will not be offered, sold or purchased in Australia, Canada, South Africa or Japan. The information contained in this press release does not constitute an offer of securities for sale in Australia, Canada, South Africa or Japan. The distribution of this press release in certain countries may constitute a breach of applicable law. 5